Method and system for efficient transfer of cryptocurrency associated with a payroll on a blockchain that leads to an automated payroll method and system based on smart contracts

ABSTRACT

The invention relates to blockchain technologies such as the Bitcoin blockchain, and the tokenisation of assets or entities. It is particularly suited for implementing a payroll on a blockchain platform and comprises a method (100) and system (1) of transferring cryptocurrency from a first node (3) to a second node (7). Both nodes (3, 7) are associated with a payroll and have a respective asymmetric cryptography pair, each pair including a master private key and a master public key. Respective additional private and public keys may be determined based on the master private key, master public key and a generator value at each node. The additional private and public keys may form a hierarchical structure. A common secret may be determined at each of the nodes (3, 7) based on the additional private and public keys. The common secret may be used to securely transmit confidential information across a communications network (5).

TECHNICAL FIELD

The present disclosure relates generally to blockchain technologies,cryptography and cryptocurrencies. In particular, it relates to a secureand improved method of transfer between a multiple of nodes associatedwith a computer-based system such as, but not limited to, a payrollsystem. The transfer may be a transfer of a quantity of cryptocurrency.

BACKGROUND

Many computer-based systems store and process data relating to aplurality of entities such as individuals. This data must be stored,processed and transmitted in a secure and efficient manner. In manyinstances, a record of the data and any changes made to it, must bestored in an immutable and permanent manner for future reference. Forexample, a payroll of an entity typically includes a record of theentity's employees and wages allocated to the employees. Information inrelation to tax withheld and other contributions such as superannuationmay be included on the payroll. Details about the employees' leaveentitlements or benefits may also be included on the payroll.

Blockchain technologies can be used to store data in an immutable andpermanent manner. A blockchain is a consensus-based, electronic ledgerwhich is implemented as a computer-based decentralised, distributedsystem made up of blocks which in turn are made up of transactions. Eachtransaction is a data structure that encodes the transfer of control ofa digital asset between participants in the blockchain system, andincludes at least one input and at least one output. Each block containsa hash of the previous block to that blocks become chained together tocreate a permanent, unalterable record of all transactions which havebeen written to the blockchain since its inception. Transactions containsmall programs known as scripts embedded into their inputs and outputs,which specify how and by whom the outputs of the transactions can beaccessed. On the Bitcoin platform, these scripts are written using astack-based scripting language.

In order for a transaction to be written to the blockchain, it must be“validated”. Network nodes (miners) perform work to ensure that eachtransaction is valid, with invalid transactions rejected from thenetwork. Software clients installed on the nodes perform this validationwork on an unspent transaction (UTXO) by executing its locking andunlocking scripts. If execution of the locking and unlocking scriptsevaluate to TRUE, the transaction is valid and the transaction iswritten to the blockchain. Thus, in order for a transaction to bewritten to the blockchain, it must be i) validated by the first nodethat receives the transaction—if the transaction is validated, the noderelays it to the other nodes in the network; and ii) added to a newblock built by a miner; and iii) mined, i.e. added to the public ledgerof past transactions.

Although blockchain technology is most widely known for the use ofcryptocurrency implementation, digital entrepreneurs have begunexploring the use of both the cryptographic security system Bitcoin isbased on and the data that can be stored on the Blockchain to implementnew systems. It would be highly advantageous if the blockchain could beused for automated tasks and processes which are not limited to therealm of cryptocurrency. Such solutions would be able to harness thebenefits of the blockchain (e.g. a permanent, tamper proof records ofevents, distributed processing etc) while being more versatile in theirapplications.

One area of current research is the use of the blockchain for theimplementation of “smart contracts”. These are computer programsdesigned to automate the execution of the terms of a machine-readablecontract or agreement. Unlike a traditional contract which would bewritten in natural language, a smart contract is a machine executableprogram which comprises rules that can process inputs in order toproduce results, which can then cause actions to be performed dependentupon those results.

Another area of blockchain-related interest is the use of ‘tokens’ (or‘coloured coins’) to represent and transfer control or ownership ofreal-world entities via the blockchain. A potentially sensitive orsecret item can be represented by the token which has no discernablemeaning or value. The token thus serves as an identifier that allows thereal-world item to be referenced from the blockchain.

Any discussion of documents, acts, materials, devices, articles or thelike which has been included in the present specification is not to betaken as an admission that any or all of these matters form part of theprior art base or were common general knowledge in the field relevant tothe present disclosure as it existed before the priority date of eachclaim of this application.

Throughout this specification the word “comprise”, or variations such as“comprises” or “comprising”, will be understood to imply the inclusionof a stated element, integer or step, or group of elements, integers orsteps, but not the exclusion of any other element, integer or step, orgroup of elements, integers or steps.

In this document we use the term ‘blockchain’ to include all forms ofelectronic, computer-based, distributed ledgers. These include, but arenot limited to consensus-based blockchain and transaction-chaintechnologies, permissioned and un-permissioned ledgers, shared ledgersand variations thereof. The most widely known application of blockchaintechnology is the Bitcoin ledger, although other blockchainimplementations have been proposed and developed. While Bitcoin may bereferred to herein for the purpose of convenience and illustration, itshould be noted that the invention is not limited to use with theBitcoin blockchain and alternative blockchain implementations andprotocols fall within the scope of the present invention.

SUMMARY

The present invention is defined in the appended claims.

Embodiments and aspects of the present invention may provide acomputer-implemented method for efficient and/or secure transfer ofcryptocurrency or other digital asset. Additionally or alternatively,the invention may be described as a tokenisation method, a securitymethod and/or a method for controlling an exchange or transfer on ablockchain. The exchange or transfer may relate to a digital asset suchas, for example, a quantity of cryptocurrency, or a token that isrepresentative of or associated with an entity. The tokenised entity maybe stored on or off the blockchain. The invention may provide one ormore systems for implementation of the methods of the invention.

The invention may require the interaction and inter-communication ofvarious distinct and separate computer-based resources, such as one ormore user devices and a distributed computer system (blockchain) whichincludes computing nodes arranged to execute blockchain-related softwareand protocols. The invention may comprise a computer-implemented systemarranged to implement or execute one or more of the methods describedherein.

The cryptocurrency may be associated with a data processing and/orstorage resource, such as a payroll, on a peer-to-peer distributedledger (blockchain). The transfer may be between a multiple of nodes,including a first transfer from a first node to a second node.

The method may comprise one or more of the following steps:

-   -   receiving a first request to transfer a first quantity of        cryptocurrency associated with the first transfer from the first        node to the second node;    -   determining a second node master public key associated with the        second node, wherein the second node master public key forms a        cryptographic pair with a second node master private key;    -   determining a generator value;    -   determining a second node second public key based on at least        the second node master public key and the generator value;    -   determining a first output script, wherein the first output        script is based on:        -   at least a first metadata that includes information            associated with the first transfer; and        -   the second node second public key;    -   sending, over a communications network, a first data output to a        peer-to-peer distributed ledger based on:        -   an indication of the first transfer from the first node to            the second node; and        -   the first output script, wherein the first output script is            associated with the first quantity of cryptocurrency.

The present disclosure may allow a public peer-to-peer distributedledger, such as the bitcoin Blockchain, to be used as the repository ofaccounts related to payroll information of an employer entity.

The first metadata may be based on information provided by the firstnode in the first request, wherein the metadata comprises informationassociated with the payroll and the second node. The first metadata maycomprise a hash of the information associated with the payroll and thesecond node.

The method may further comprise a first node master public keyassociated with the first node, wherein the first node master public keyforms a cryptographic pair with a first node master private key.

The method may further comprise at least one first node additionalpublic key or at least one second node additional public key determinedbased on at least the first node master public key and the generatorvalue or the second node master public key and the generator valuerespectively. A first node second public key may be determined based onat least the first node master public key and the generator value,wherein the first node second public key forms a cryptographic pair witha first node second private key.

The first node second public key or first node additional public key maybe associated with a tax withheld of the second node. The second nodesecond public key or second node additional public key may be associatedwith a tax withheld of the second node. The first node second public keyor first node additional public key may be associated with asuperannuation contribution of the second node. The second node secondpublic key or second node additional public key may be associated with asuperannuation contribution of the second node. The first node secondpublic key or first node additional public key may be associated with ahouse mortgage payment. The second node second public key or second nodeadditional public key may be associated with a house mortgage payment.The first node second public key or first node additional public key maybe associated with a college fund. The second node second public key orsecond node additional public key may be associated with a college fund.

The generator value may be based on a string associated with the firstnode. Alternatively, the generator value may be based on Unix time and anonce. In yet another alternative the generator value may change basedon a payment period.

The generator value may be retrieved from a data store 17.Alternatively, the generator value may be received from a third party.

The generator value may be used to determine a common secret based onthe second node second private key and the first node second public key,wherein the second node has the same common secret based on the firstnode second public key and the second node second private key.

A method of securely transmitting at least part of the first metadatabetween the first node and the second node with symmetric-key algorithm,wherein the method comprises:

-   -   determining a symmetric-key based on the common secret        determined according to the method described above;    -   encrypting at least part of the first metadata with the        symmetric-key, to an encrypted at least part of the first        metadata; and    -   sending, over the communications network, the encrypted at least        part of the first metadata from the first node to the second        node.

A method of securely transmitting the first output script or informationassociated with the payroll and the second node between the first nodeand the second node with symmetric-key algorithm, wherein the methodcomprises:

-   -   determining a symmetric-key based on the common secret        determined according to the above described method;    -   encrypting at least part of the first output script or        information associated with the payroll and the second node with        the symmetric-key, to an encrypted first output script or        encrypted information associated with the payroll and the second        node; and    -   sending, over the communications network, the encrypted first        output script or encrypted information associated with the        payroll and the second node from the first node to the second        node.

A method of verifying the first transfer as described above, the methodcomprising:

-   -   receiving a request to confirm the first transfer;    -   determining the first data output corresponding to the first        transfer of the first quantity of cryptocurrency;    -   receiving, over the communications network, at least part of the        first data output from the peer-to-peer distributed ledger;    -   determining, from the first data output, the indication of the        first transfer;    -   verifying that the indication of the first transfer corresponds        to the first transfer in the request; and    -   sending an output indicative of the result of verifying.

The method may further comprise a first token associated with the firstquantity of cryptocurrency. The first token may comprise informationassociated with employment rights and benefits of the first node orsecond node. The first token may be transferred from the first node tothe second node.

A computer program comprising machine-readable instructions to cause aprocessing device to implement any one of the methods described above.

A device including a processing device to perform the method accordingto any one of the methods described above.

A system for efficient transfer of cryptocurrency associated with apayroll on a peer-to-peer distributed ledger between a multiple of node,including a first transfer from a first node to a second node, thesystem comprising:

-   -   a first processing device configured to:    -   receive a first request from the first node to transfer a first        quantity of cryptocurrency associated with the first transfer        from the first node to the second node;    -   determine a second node master public key associated with the        second node, wherein the second node master public key forms a        cryptographic pair with a second node master private key;    -   determine a generator value;    -   determine a second node second public key based on at least the        second node master public key and the generator value;    -   determine a first output script, wherein the first output script        is based on:        -   at least a first metadata that includes information            associated with the first transfer; and        -   the second node public key;    -   send, over a communications network, a first data output to a        peer-to-peer distributed ledger based on:        -   an indication of the first transfer from the first node to            the second node; and        -   the first output script, wherein the first output script is            associated with the first quantity of cryptocurrency.            Any feature described herein in respect of one aspect or            embodiment of the invention may also be application or one            or more other aspects or embodiments.

BRIEF DESCRIPTION OF DRAWINGS

Examples of the present disclosure will be described with reference to:

FIG. 1 is a schematic diagram of an example system to transfercryptocurrency between a multiple of nodes associated with a payroll;

FIG. 2 is a schematic diagram of users at a multiple of nodes associatedwith a payroll;

FIG. 3 is a flow chart of a computer-implemented method for transferringcryptocurrency between a multiple of nodes associated with a payroll;

FIG. 4 is a flow chart of computer-implemented methods for determining acommon secret;

FIG. 5 is a schematic diagram of an employee's accounts associated witha payroll;

FIG. 6 is another flow chart of computer-implemented methods fordetermining a common secret;

FIG. 7 is a flow chart of computer-implemented methods of securecommunication between the first node and second node;

FIG. 8 is an example of a hierarchical chain structure of keys;

FIG. 9 is an example of a tree structure of different keys for differentpurposes;

FIG. 10 is an example of a tree structure using the master key spawningmethod;

FIG. 11 is a flow chart of a computer-implemented method for verifying atransfer of cryptocurrency; and

FIG. 12 illustrates a schematic of an example processing device.

DESCRIPTION OF EMBODIMENTS

The present disclosure generally relates to methods and apparatus forutilising a peer-to-peer (P2P) distributed ledger, such as the Bitcoinblockchain, to enable the transfer of cryptocurrency between a multipleof nodes associated with a data storage and processing system such as,for example, a payroll.

Whilst embodiments described below may refer specifically totransactions that occur on the bitcoin Blockchain (referred to herein asthe Blockchain), it will be appreciated that the present invention maybe implemented using other P2P distributed ledgers. The Blockchain isused below to describe aspects of the invention for simplicity only dueto its high level of standardisation and large quantity of associatedpublic documentation.

Bitcoin and the Blockchain

As described above and well known in the art, the Blockchain is atransaction ledger or database which is distributed across networkednodes participating in a system based on the bitcoin protocol. Eachbitcoin transaction is broadcast to the network, the transactions areconfirmed and then aggregated into blocks. The blocks are then includedon the Blockchain.

A full copy of a cryptocurrency's P2P distributed ledger contains everytransaction ever executed in the cryptocurrency. Thus, a continuouslygrowing list of transactional data records is provided. Since eachtransaction entered onto the Blockchain is cryptographically enforced,the Blockchain is hardened against tampering and revision, even byoperators of the data store nodes.

Due to the transparency of the Blockchain, transaction histories arepublicly available for each transaction. It is a further advantage ofthe Blockchain that the transaction and the record of the transactionare the same, i.e. the record of the transaction is embedded within thetransaction.

In this way, the information relating to the transaction is captured inthe actual transaction. This record is permanent and immutable, and eachtransaction that is conducted using bitcoin is therefore not onlyfacilitated by the Blockchain, but also immutably recorded in theBlockchain. This therefore removes the requirement for a third party tokeep the transaction record on a separate database.

Pay-to-Script-Hash and Multi-Signature

Whilst embodiments below may refer specifically to transactions that usethe pay-to-script-hash (P2SH) method of the bitcoin protocol, it will beappreciated that the present invention may be implemented using anothermethod of the bitcoin protocol (or an alternative protocol) such as thepay-to-public-key-hash method.

Each transaction record on the Blockchain comprises a script includinginformation indicative of the transaction and a number of public keys.These public keys may be indicative of, and associated with, the senderand recipient of the cryptocurrency. A script can be considered as alist of instructions recorded with each transaction record on theBlockchain that describes how a user may gain access to thecryptocurrency specified in the transaction record.

As background, in a standard P2SH method of the bitcoin protocol, theoutput script, or redeem script, may take the form:

<NumSigs PubK1 PubK2 . . . PubK15 NumKeys OP_CHECKMULTISIG>

where NumSigs is the number “m” of valid signatures required to satisfythe redeem script to unlock the transaction; PubK1, PubK2 . . . PubK15are the public keys that correspond to signatures that unlock thetransaction (up to a maximum of 15 public keys) and NumKeys is thenumber “n” of public keys.

To redeem the above redeem script, at least a number “m” of signaturescorresponding to the public keys are required. In some examples, theorder of the public keys is important and the number “m” out of “n”signatures for signing must be done in sequence. For example, considerwhere “m” is 2 and “n” is 15. If there are two signatures are availablefor use, Sig1 (corresponding to PubK1) and Sig 15 (corresponding toPubK15), the redeem script must be signed by Sig1 first followed bySig15.

While the exemplary embodiments below refer to the bitcoin Blockchain asthe public ledger, it is to be understood the disclosure also applies toany public ledger that utilises a cryptocurrency.

Overview of the System

A method, device and system to transfer cryptocurrency between amultiple of nodes associated with a payroll will now be described.

FIG. 1 illustrates a system 1 that includes a first node 3 that is incommunication with, over a communications network 5, a second node 7.The first node 3 has an associated first processing device 21 and thesecond node 5 has an associated second processing device 27. The firstand second nodes 3, 7 may include an electronic device, such as acomputer, tablet computer, mobile communication device, computer serveretc.

A P2P distributed ledger 13 to record transactions is also illustratedin FIG. 1. The P2P distributed ledger may be associated with one or moreprocessing devices 19 to receive and record transactions. As describedabove, an example of a P2P distributed ledger is the bitcoin Blockchain.Therefore, in the context of the Blockchain, the processing devices 19associated with the P2P distributed ledger may be processing devicesused by “miners”.

The first node 3 is associated with a first user 23 and the second node7 is associated with a second user 24. The first node 3 may receive afirst request from the first user 23 to transfer a first quantity ofcryptocurrency. In one example, the first user 23 is an employer and thesecond user 24 is an employee of the employer 23 and the transfer of thefirst quantity of cryptocurrency is remuneration (i.e. salary or wage).In further examples, the second user 24 may be a government body such asthe Australian Tax Office or a superannuation fund.

In another example, the first request from the first node 3 is receivedat a third node 9. The third node 9 may represent an issuer or serviceprovider 25 of the first and second nodes 3, 7. The third node 9 may beinvolved in facilitating the transfer of cryptocurrency.

FIG. 2 illustrates two exemplary employees at a second node 7 and afurther node, where these employees are associated with the employer 23at the first node 3.

While the exemplary embodiments below refer to the first node 3 asperforming the methods it is to be understood the disclosure may also beadapted or modified to be performed by other nodes.

The method 100 as illustrated in FIG. 3 includes receiving 110 a firstrequest from the first node 3 to transfer a first quantity ofcryptocurrency associated with the first transfer from the first node 3to the second node 7. The first quantity of cryptocurrency may beassociated with a payroll of the first node 3. For example, the firstquantity of cryptocurrency may represent payment to a second user 24(employee) from the first user 23 (employer).

The method 100 also includes determining 120 a second node master publickey associated with the second node 7. The second node master public keyforms a cryptographic pair with a second node master private key. Themethod 100 also includes determining 130 a generator value (GV). Thegenerator value may be based on a message (M) that is shared between thefirst and second nodes, which may include sharing the message over thecommunications network 5. The method 100 also includes determining 140 asecond node second public key based on at least the second node masterpublic key and the generator value (GV).

The method 100 also includes determining 150 a first output script basedon at least a first metadata that includes information associated withthe first transfer and the second user second public key. In oneexample, the first output script may be a first redeem script using theP2SH method of the bitcoin protocol. In another example, the firstoutput script may be a first output script using thepay-to-public-key-hash method of the bitcoin protocol.

The method 100 also includes sending 160, over a communications network5, a first data output to a P2P distributed ledger 13 based on anindication of the first transfer from the first node 3 to the secondnode 7 and the first output script. The indication of the first transferrecords the underlying first quantity of cryptocurrency has beentransferred to the second node 7. The first data output may alsocomprise the first output script or a hash of the first output script.

A detailed example of the method will now be described.

Receiving a Request 110

As described above the method 100 includes receiving 110 a first requestto transfer a first quantity of cryptocurrency associated with the firsttransfer from the first node 3 to the second node 7. In one example, thethird node 9 or issuer/service provider 25 receives the request from theemployer 23 at the first node 3. For instance, personnel from the humanresources department associated with the first node 3 may send therequest to the third node 9 or issuer/service provider 25.

In another example, personnel from the human resources departmentassociated with the first node 3 may send the request to the payrolldepartment associated with the first node 3.

The request may include details associated with the first quantity ofcryptocurrency, for example the exact amount of the first quantity ofcryptocurrency. The request may further include details of the recipientof the first quantity of cryptocurrency, for example employee details.Employee details may include information about the employee's positionat the employer, pay period and pay rate.

Determining a Second Node Master Public Key 120

As also described above the method 100 further includes determining 120a second node master public key associated with the second node (e.g. anemployee's public key), wherein the second node master public key formsa cryptographic pair with a second node master private key. In oneexample, the second node master public key is received over thecommunications network 5 from the second node 7. In another example, thesecond node master public key is retrieved from a data store 17. In yetanother example, the second node master public key is received from athird node 9 or the issuer/service provider 25.

Determining the Generator Value 130

As described above, the method 100 includes determining 130 a generatorvalue and further includes determining 140 a second node second publickey by way of the second node master public key and the generator value(GV). The present disclosure may also determine a first node secondpublic key based on the first node master public key and the generatorvalue (GV).

To determine the generator value (GV) the nodes 3, 7 may perform stepsof respective methods 300, 400 as illustrated in FIG. 4.

The generator value (GV) may be random, pseudo random, or user defined.In one example, the generator value (GV) is based on a string associatedwith the first node 3. For example, the string may be the identificationnumber of the second user 24 (e.g. an employee identification number).In a further example the generator value (GV) may be a concatenation ofthe string as described above with one or more values. For instance, thevalue may be the date that the first request is received.

A further example of the value may be a string indicating the purpose ofthe key being derived. For instance, if the key is to be used totransfer cryptocurrency associated with tax withheld of the second user24, the value may comprise a string that includes the word ‘tax’.

In yet another example, the generator value (GV) is based on Unix timeand a nonce. In a further example the generator value (GV) changes basedon a payment period associated with the first node and the second node.For example, if the payment period is fortnightly, the generator value(GV) may change on a fortnightly basis.

FIG. 5 illustrates two accounts that are associated with an employee Alocated at the second node 7. The first account is for the month ofJanuary and has a designated generator value GV-January, and the secondaccount is for the month of February and has a designated generatorvalue GV-February.

In some examples, the generator value may be arbitrary. However, it isto be appreciated that the generator value may have selective values(such as Unix time, etc) that may be useful in some applications.

The generator value may be retrieved from a data store 17. In anotherexample the generator value is received from a third party.

Generating a Message (M)

The generator value that is determined in step 130 may be based on amessage (M). As illustrated in FIG. 6, the method 300 performed by thefirst node 3 includes generating 310 a message (M). The message (M) maybe random, pseudo random or user defined as described above with respectto the generator value.

In one example, the message (M) is based on Unix time and a nonce(arbitrary value). For example, the message (M) may be provided as:

Message (M)=UnixTime+nonce   (Equation 1)

The method 300 includes sending 315 the message (M), over thecommunications network 5, to the second node 7. The message (M) may besent over an unsecure network as the message (M) does not includeinformation on the private keys.

Determining the Generator Value (GV) from the Message (M)

The method 300 as illustrated in FIG. 6 further includes the step ofdetermining 320 a generator value (GV) based on the message (M). In thisexample, this includes determining a cryptographic hash of the message.An example of a cryptographic hash algorithm includes SHA-256 to createa 256-bit generator value (GV). That is:

GV=SHA−256(M)   (Equation 2)

It is to be appreciated that other hash algorithms may be used. This mayinclude other hash algorithms in the Secure Hash Algorithm (SHA) family.Some particular examples include instances in the SHA-3 subset,including SHA3-224, SHA3-256, SHA3-384, SHA3-512, SHAKE128, SHAKE256.Other hash algorithms may include those in the RACE Integrity PrimitivesEvaluation Message Digest (RIPEMD) family. A particular example mayinclude RIPEMD-160. Other hash functions may include families based onZémor-Tillich hash function and knapsack-based hash functions.

Determining a Second Node Second Public Key 140

The method 100 further includes determining 140 a second node secondpublic key based on at least the second node master public key and thegenerator value.

As described above, the second node master public key and the secondnode master private key form a cryptographic pair. This cryptographicpair may be generated using the common elliptic curve cryptography (ECC)system with a base point (G).

That is, the step of generating the second node master public key andthe second node master private key may comprise: generating the secondnode master private key (V_(1E)) based on a random integer in theallowable range specified in the common ECC system; and determining thefirst node master public key (P_(1C)) based on elliptic curve pointmultiplication of the first node master private key (V_(1C)) and thebase point (G) according to the following formula:

P _(1P) =V _(1P) ×G.   (Equation 3)

In this example, since the public key (that is, the second node masterpublic key P_(1E)) is determined 370′ as the private key with ellipticcurve point multiplication with the generator (G), it can be shown thatthe second node second public key (P_(2E)) can be expressed as:

P _(2E) =P _(1E) +GV×G   (Equation 4)

Thus the second node second public key (P_(2E)) is not a random valuebut is instead deterministically derived given knowledge of the secondnode master public key.

Determining a First Output Script 150

The method 100 further includes determining 150 a first output scriptthat is based on at least a first metadata that includes informationassociated with the first transfer. In the P2SH method of the bitcoinprotocol, metadata may be included in the output script by way of themethod outlined below.

Metadata

Metadata may be embedded in the redeem script in one or more of the 15places available for the public keys in a P2SH multi-signature redeemscript. For example, the redeem script may take the form of:

<NumSigs Metadata1 Metadata2 . . . PubK1 PubK2 . . . NumKeysOP_CHECKMULTISIG>

where Metadata1 and Metadata2 each include metadata that takes the placeof a public key in the redeem script and PubK1 and PubK2 are publickeys.

By inserting metadata that is associated with the transfer ofcryptocurrency, for example information associated with the payroll andthe second node 7, the hash of the information will be included in theledger when the transaction (Tx) is written to the blockchain.

Therefore, the use of multi-signature P2SH bitcoin transactions inembodiments of the present disclosure offers an advantage as it enablesthe transfer of cryptocurrency associated with a payroll to carry ametadata payload.

The metadata may include a description or keyword describing conditionsassociated with the transfer of cryptocurrency. For example, the date ofthe transfer, name, date of birth, address, contact details, or otherdetails of the first user 23 or second user 24 at the first node 3 orsecond node 7 respectively may be included. In a further example,information associated with the quantity of cryptocurrency may beincluded.

In the example of where the first user 23 associated with the first node3 is the employer and the second user 24 associated with the second node7 is the employee, the information in the metadata may be analogous tothe information in a traditional payslip. The metadata may comprise thename of the employer and employee, the pay period, date of payment,gross and net pay to the employee, the pay rate of the employee, any taxwithheld or superannuation contributions, bonuses and the officialbusiness number of the employer (such as the Australian BusinessNumber).

In a further example the metadata may comprise a string associated withthe employer or employee, such as an identification number of series ofcharacters.

The metadata in the redeem script may include the information in anumber of ways. In one example, the contents of the information may beincluded. In a further example, a cryptographic hash of the informationmay be included. The hash of the information may be determined using theSHA-256 algorithm to create a 256-bit representation of the information.It is to be appreciated that other hash algorithms may be used,including other algorithms in the Secure Hash Algorithm (SHA) family.Some particular examples include instances in the SHA-3 subset,including SHA3-224, SHA3-256, SHA3-384, SHA3-512, SHAKE128, SHAKE256.Other hash algorithms may include those in the RACE Integrity PrimitivesEvaluation Message Digest (RIPEMD) family. A particular example mayinclude RIPEMD-160. Other hash functions may include families based onZémor-Tillich hash function and knapsack-based hash functions.

In a further example, the metadata may include a pointer, address orother reference to a location e.g. file that contains the information.For instance, the metadata may include a pointer to a payslip that isassociated with the first node and the second node. This pointer maycomprise an IPv6 address of the actual file location.

In further embodiments of the present disclosure, combinations includingone or more of the above may be included in the metadata. Since themetadata may be made public by way of the P2P distributed ledger such asthe Blockchain, or transmitted over an unsecure network, it may bedesirable that specific details of the metadata be veiled or hidden forprivacy reasons.

Sending a First Data Output to a P2P Distributed Ledger 160

The method 100 further includes sending 160, over a communicationsnetwork 5, a first data output to a P2P distributed ledger provides arecord on the ledger of the first transfer from the first node 3 to thesecond node 7. In other words, the transaction (Tx) is sent to theblockchain network for validation and subsequent inclusion in a block onthe ledger.

The first data output may be the transaction record stored on theBlockchain. Each transaction record on the Blockchain comprises at leasta first node public key associated with the first node 3 and a secondnode public key associated with the second node 7. The first node publickey may comprise the first node master public key, first node secondpublic key or first node additional public keys. The second node publickey may comprise the second node master public key, second node secondpublic key or second node additional public keys. As is described laterin the present disclosure, methods 300 and 400 may be repeated to yieldthe first node additional public keys and the second node additionalpublic keys. This identifies that the first node 3 and the second node 7are involved in the transaction that is stored on the Blockchain.

Further, each transaction record on the Blockchain comprises at least anindication of the first transfer of a first quantity of cryptocurrencyfrom the first node 3 to the second node 7.

Examples of transactions may include cryptocurrency transactions, fiatcurrency transactions or tokens as described in further detail below.

Variations: Determining a Common Secret for Securely Transmitting Data

To determine the generator value and common secret (CS) at both thefirst node 3 and second node 7, the nodes 3, 7 perform steps ofrespective methods 300, 400 without communicating private keys over thecommunications network 5. A description of the process of determiningthe generator value and common secret, as well as generating the firstnode second public and private keys and the second node second publicand private keys now follows. A summary of the methods 300 and 400 isprovided below with reference to the figures.

As illustrated in FIG. 4, the method 300 performed by the first node 3includes determining 330 a first node second private key (V_(2P)) basedon at least the first node master private key (V_(1P)) and a generatorvalue (GV) as described above. The generator value (GV) may in someexamples be based on a message (M) that is shared between the first andsecond nodes 3, 7, which may include sharing the message over thecommunications network 5 as described in further detail below. Themethod 300 also includes determining 370 a second node second public key(P_(2E)) based on at least the second node master public key (P_(1E))and the generator value (GV). The method 300 includes determining 380the common secret (CS) based on the first node second private key(V_(2P)) and the second node second public key (P_(2E)).

Importantly, the same common secret (CS) can also be determined at thesecond node 7 by method 400. The method 400 includes determining 430 afirst node second public key (P_(2P)) based on the first node masterpublic key (P_(1P)) and the generator value (GV). The method 400 furtherincludes determining 470 a second node second private key (V_(2E)) basedon the second node master private key (V_(1E)) and the generator value(GV). The method 400 includes determining 480 the common secret (CS)based on the second node second private key (V_(2E)) and the first nodesecond public key (P_(2P)). The methods 300, 400 may be repeated toyield first node additional public keys or second node additional publickeys, as will be described later.

The communications network 5, may include a local area network, a widearea network, cellular networks, radio communication network, theinternet, etc. These networks, where data may be transmitted viacommunications medium such as electrical wire, fibre optic, orwirelessly may be susceptible to eavesdropping, such as by aneavesdropper 11. The method 300, 400 may allow the first node 3 andsecond node 7 to both independently determine a common secret withouttransmitting the common secret over the communications network 5. Thusone advantage is that the common secret (CS) may be determined securelyby each node without having to transmit a private key over a potentiallyunsecure communications network 5. In turn, the common secret may beused as a secret key (or as the basis of a secret key) for encryptedcommunication between the first and second nodes 3, 7 over thecommunications network 5.

Determine the Common Secret 380 at the First Node 3 and Second Node 7

An example of determining a common secret (CS) will now be describedwith reference to FIG. 6. The common secret (CS) may be used for aparticular session, time, transaction, or other purpose between thefirst node 3 and the second node 7 and it may not be desirable, orsecure, to use the same common secret (CS). Thus the common secret (CS)may be changed between different sessions, time, transactions, etc.

The first node 3 may determine 380 the common secret (CS) based on thedetermined first node second private key (V_(2P)) and the determinedsecond node second public key (P_(2E)). The common secret (CS) may bedetermined by the first node 3 by the following formula:

CS=V _(2P) ×P _(2E)   (Equation 5)

The second node 7 may further determine 470 the common secret (CS) basedon the second node private key (V_(2E)) and the first node second publickey (P_(2P)) based on the following formula:

CS=V _(2E) ×P _(2P)   (Equation 6)

Securely Transmitting Information

The metadata as described above may comprise information of aconfidential or sensitive nature. The first node 3 or second node 7 mayrequire secure transmission of at least part of metadata or theinformation contained in the metadata, which may be achieved by havingonly the hash of that information stored within the unlocking (redeem)script. In a further example, the first output script may need to besecurely transmitted. In yet a further example, a message or informationassociated with the payroll and the second user 24 (for instance,details of a payslip) may require secure transmission from the firstnode 3 to the second node 7.

The present disclosure may be used to facilitate secure communication,in particular sending and receiving communication messages, between thefirst node 3 and the second node 7 over a potentially unsecurecommunications network 5. This may be achieved by using the commonsecret (CS) determined separately by the first node and second node asthe basis for a symmetric-key. It is to be understood that there may bevarious methods of generating a common secret that can be used with theinvention. However, the method of determining a common secret (CS) andusing the symmetric-key for encryption and decryption of thecommunication messages as disclosed herein may be more computationallyefficient compared to known public-key encryption methods.

Methods 500, 600 of secure communication between the first node 3 andsecond node 7 will now be described with reference to FIG. 7. The firstnode 3 determines 510 a symmetric-key based on the common secret (CS)determined in the method above. This may include converting the commonsecret (CS) to a standard key format. Similarly, the second node 7 canalso determine 610 the symmetric-key based on the common secret (CS).

To send a first communication message securely from the first node 3,over the communications network 5, to the second node 7, the firstcommunication message needs to be encrypted. Thus the symmetric-key isused by the first node for encrypting 520 a first communication messageto form an encrypted first communication message, which is then sent530, over the communications network 5, to the second node 7. The secondnode 7, in turn, receives 620 the encrypted first communication message620, and decrypts 630 the encrypted first communication message, withthe symmetric-key, to the first communication message.

Similarly, the second node 7 may encrypt 640 a second communicationmessage, with the symmetric-key, to an encrypted second communicationmessage, which is then sent 650 to the first node 3. The first node 3may then receive 540 the encrypted second communication message, anddecrypt 550 it to the second communication message.

Hierarchy of Accounts—Chain Structure

As can be seen from the methods 300, 400 described above, the secondnode second public key (P_(2E))is deterministically derived from thesecond node master public key (P_(1E)). Similarly, the first node secondpublic key may also be deterministically derived from the first nodemaster public key (P_(1P)). By performing the methods 300, 400repeatedly, a first node additional public key and second nodeadditional public key may also be deterministically derived.

That is, the methods 300, 400 described above may be used to determine aseries of successive generator values, where each successive generatorvalue may be determined based on the preceding generator value.Alternatively, successive keys may be determined based directly on themaster key. Alternatively successive keys may be determined by acombination of the above methods.

For example, instead of repeating steps 310 to 370′ of method 300 togenerate successive single-purpose keys, by prior agreement between thenodes 3, 7, the previously used message for the generator value (GV) canbe rehashed repeatedly by both parties to establish a hierarchy ofgenerator values. In effect, the generator value, based on the hash of amessage (M), can be a next generation message (M′) for the nextgeneration of generator value (GV-2). Doing this allows successivegenerations of shared secrets to be calculated without the need forfurther protocol-establishment transmissions, in particular transmissionof multiple messages for each generation of common secrets. The nextgeneration common secret (CS′) can be computed as follows.

Firstly, both the first node 3 and the second node 7 independentlydetermine the next generation of the generator value (GV-2). This issimilar to steps 320 and 420 but adapted with the following formulas:

M′=SHA-256(M)   (Equation 7)

GV-2=SHA-256(M′)   (Equation 8)

GV-3=SHA-256(SHA-256(M))   (Equation 9)

The first node 3 may then determine the next generation of the secondnode second public key (P_(3E)) and the first node second private key(V_(3P)) similar to steps 370 and 330 as described above. In thisexample, the next generation is the third generation, i.e. the secondnode third public key and the second node third private key aredetermined. The second node 7 may then determine the next generation(third generation) of the first node second public key (P_(3P)) and thesecond node second private key (V_(3E)) similar to steps 430 and 470 asdescribed above.

The first node 3 and the second node 7 may then each determine the nextgeneration common secret (CS′).

In particular, the first node 3 determines the next generation commonsecret (CS′) with the formula:

CS′=V _(3P) ×P _(3E)   (Equation 10)

The second node 7 determines the next generation common secret (CS′)with the formula:

CS′=V _(3E) ×P _(3P)   (Equation 11)

Further generations (CS″, CS′″, etc.) can be calculated in the same wayto create a chain hierarchy. This technique requires that both the firstnode 3 and the second node 7 keep track of the original message (M) orthe originally calculated generator value (GV), and to which node itrelates. As this is publicly known information there are no securityissues regarding the retention of this information. Accordingly, thisinformation might be kept on ‘hash tables’ (linking hash values topublic keys) and distributed freely across the network 5 (for exampleusing Torrent). Furthermore, if any individual common secret (CS) in thehierarchy is ever compromised, this does not affect the security of anyother common secrets in the hierarchy provided the private keys V_(1P),V_(1E) remain secure.

FIG. 8 demonstrates an example of a hierarchical chain structure ofkeys. In this structure, the generator values GV-2 and GV-3 may becomputed as described above in Equations 7 to 9. However, it is to beunderstood that the generator values may be calculated in alternativeways.

The different keys may be used for different payment purposes andrepresent accounts associated with the first node 3 or the second node7. For example, P_(2P) may represent the account where thecryptocurrency, for example payroll funds of the employer associatedwith the first node, is transferred from and P_(2E) may represent thecorresponding account at the second node 7 that receives the transferredcryptocurrency from the first node 3.

In a further example, P_(3P) may represent the tax withheld by theemployer associated with the first node 3 for the second node 7 whichmay be transferred into the account represented by P_(3E). In thisexample, the account represented by P_(3E) may be associated with thetax withheld, or may be a general account for receiving cryptocurrency.In yet a further example, P_(4P) (or any subsequent next generationpublic key) may represent the superannuation contribution of the secondnode, which may be transferred into P_(4E) (or any subsequent nextgeneration public key). In this example, the account represented byP_(4E) may be associated with the superannuation contribution, or may bea general account for receiving cryptocurrency.

In the instance where the first node 3 transfers a second quantity ofcryptocurrency associated with tax withheld to the second node 7, thesecond node 7 may request a second transfer associated with the receivedsecond quantity of cryptocurrency. This may comprise a transfer from thesecond node 7 to a further node that is representative of a relevant taxbody, for example, the Australian Tax Office.

In a further example, in the instance where the first node 3 transfers athird quantity of cryptocurrency associated with a superannuationcontribution to the second node 7, the second node 7 may request a thirdtransfer associated with the third quantity of cryptocurrency. This maycomprise a transfer from the second node 7 to a further node that isrepresentative of a relevant superannuation fund.

In another example, the first node 3 may transfer the second quantity ofcryptocurrency to the relevant tax body. In a further example the firstnode may transfer the third quantity of cryptocurrency to the relevantsuperannuation fund.

In yet another example, the first node 3 may make regular payments tothe accounts associated with the second node 7 including payments tomultiple accounts. The multiple accounts may represent a bank loan,house mortgage payment, a college fund account or a holiday fund. Inthis example, the next generation public key of the first node or thesecond node may represent the bank loan, house mortgage payment, collegefund or holiday fund.

In another example, the message to generate the generator value maychange with the generation of the successive keys. This may benecessary, for example, when there is a requirement for a shared commonsecret (CS) between the successive public keys. These common secrets maybe used, for instance, for encryption of information relevant to thesuccessive public keys.

Hierarchy of Accounts—Tree Structure

In another example, a hierarchy in the form of a tree structure can becreated.

With a tree structure, a variety of keys for different purposes such asauthentication keys, encryption keys, signing keys, payment keys, etc.may be determined whereby these keys are all linked to a single securelymaintained master key. This is best illustrated in FIG. 9 that shows atree structure 901 with a variety of different keys. Each of these canbe used to create a shared secret with another party.

Tree branching can be accomplished in several ways, three of which aredescribed below.

(i) Master Key Spawning

In the chain hierarchy, each new ‘link’ (public/private key pair) iscreated by adding a multiply rehashed message to the original masterkey. For example, (showing only the private key of the first node 3 forclarity):

V _(2P) =V _(1P)+SHA-256(M)   (Equation 12)

V _(2P) ′=V _(1P)+SHA-256(SHA-256(M))   (Equation 13)

V _(2P) ″=V _(1P)+SHA-256(SHA-256(SHA-256(M)))   (Equation 14)

. . . and so on.

To create a branch, any key can be used as a sub-master key. For exampleV_(2P)′ can be used as a sub-master key (V_(3P)) by adding the hash toit as is done for the regular master key:

V _(3P) =V _(2P)′+SHA-256(M)   (Equation 15)

The sub-master key (V_(3P)) may itself have a next generation key(V_(3P)′), for example:

V _(3P) ′=V _(2P)′+SHA-256(SHA-256(M))   (Equation 16)

This provides a tree structure 903 using the master key spawning methodas shown in FIG. 10.

(ii) Logical Association

In this method all the nodes in the tree (public/private key pairs) aregenerated as a chain (or in any other way) and the logical relationshipsbetween the nodes in the tree is maintained by a table in which eachnode in the tree is simply associated with its parent node in the treeusing a pointer. Thus the pointer may be used to determine the relevantpublic/private key pairs for determining the common secret key (CS) forthe session.

(iii) Message Multiplicity

New private/public key pairs can be generated by introducing a newmessage at any point in the chain or tree. The message itself may bearbitrary or may carry some meaning or function (e.g. it might berelated to a ‘real’ bank account number, etc). It may be desirable thatsuch new messages for forming the new private/public key pairs aresecurely retained.

Verifying the First Transfer

It may be desirable or required for the first node 3 or second node 7 toverify the first transfer of the first quantity of cryptocurrency. Insome circumstances it may be required for a further node, such as thethird node 9 or the issuer/service provider 25, to verify the firsttransfer. For instance, the employee associated with the second node maywish to confirm that the amount of cryptocurrency associated with thepayroll funds is correct.

FIG. 11 illustrates a method 600 of verifying the first transfer ofcryptocurrency from the first node 3 to the second node 7. The method600 includes receiving 610 a request to confirm the first transfer. Therequest may be received at the first node 3, or at a further node suchas the third node 9 in the instance where the third node 9 isfacilitating the transfer of cryptocurrency. The method 600 includesdetermining 620 the first data output corresponding to the firsttransfer of the first quantity of cryptocurrency. Determining the firstdata output may include receiving the first data output from the firstnode 3 or the second node 7. In another example, it may includereceiving the first data output from a further node such as the thirdnode 9. In yet another example, it may include receiving the first dataoutput from a data store 17.

The method 600 then includes receiving 630, over the communicationsnetwork, at least part of the first data output from the P2P distributedledger. This may include receiving part of the transaction record storedon the ledger.

The method 600 further includes determining 640, from the first dataoutput, the indication of the first transfer and verifying 650 that theindication of the first transfer corresponds to the first transfer inthe request. This may include, for example, confirming that the firstquantity of cryptocurrency that is associated with the first transfer inaddition to confirming that the public keys in the transaction record asreceived in step 630 correspond to the public keys of the first node 3and the second node 7.

The method 600 further includes sending 660 an output indicative of theresult of verifying. The output may be sent to the node that sent therequest, for example the first node 3, the second node 7 or the thirdnode 9. In a further example the output may be sent to more than onenode.

Tokens

It will be appreciated that the first quantity of cryptocurrency, secondquantity of cryptocurrency or third quantity of cryptocurrency asdescribed in the methods above may relate to a token amount ofcryptocurrency. Tokens may represent transferable contract conferringspecified rights upon the holder to be redeemed for fiat currency, goodsor services. The contract might be a machine executable smart contract,as known in the art.

Thus, the invention may incorporate a tokenisation technique or methodfor exchanging or transferring a digital token from one party toanother. One such method, as mentioned above, comprises the steps of:

-   -   generating a blockchain transaction (Tx) having an output (TxO)        related to a quantity of cryptocurrency, and a hash of a redeem        script. The redeem script comprises:        -   metadata comprising a token which is a representation of, or            a reference to, a tokenised entity; and        -   at least one (preferably two or more) public cryptographic            keys.

The quantity of cryptocurrency may be Bitcoin but the invention is notlimited in this regard. The redeem script may be provided within alocking script associated with the transaction output TxO. The metadatamay be provided in the redeem script at a location which is designatedin the blockchain's underlying protocol as a location for acryptographic key.

The method may further include the step of submitting the transaction Txto the blockchain. In effect, the cryptocurrency may thus be locked onthe blockchain in association with the token. The quantity ofcryptocurrency can only be spent (redeemed) upon provision of anunlocking script which meets the requirements of the locking script forthe output TxO. In particular, a redeem script must be presented which,when hashed, matches the hash provided in the locking script of TxO. Asthe locking script for output TxO comprises the hash of the redeemscript which in turn includes the token (in the metadata), thecryptocurrency is associated with the token. Upon presentation of thecorrect unlocking (redeem) script, ownership of the cryptocurrency maybe transferred to the redeeming party or user i.e. it is spent.

In summary, a token is an exchangeable entity that can be used torepresent a contract or some other type of entity. The contract may takeone of several forms. It may be a computer-executable smart contract.For example, the contract may confer a right upon the holder or denoteownership of property. The value of the token may be contractuallyspecified and is linked to the underlying bitcoin amount of the output(TxO) via a ‘pegging rate’. The token is exchangeable via a novel typeof transaction using a cryptocurrency protocol such as the bitcoinprotocol. The bitcoin value on the transaction output (TxO) acts as atoken representing a rights contract in digital form. The contractitself may be stored on the transaction, or somewhere else on theblockchain, or off the blockchain, or may be kept in a publiclyaccessible location, or may be held privately by the parties to thecontract depending on the particular embodiment. Where the contract isnot stored on or in the transaction, the transaction may store a uniquepointer or reference to the contract.

Tokens may be divisible. A divisible token is one in which the value onthe transaction output can be subdivided into smaller amounts which canbe allocated across multiple new tokens. Examples of divisible tokensinclude tokens for fiat currency or for shares in a race horse.Divisible contracts may be defined as those that specify a non-zeropegging rate. In other words, the token value is tied to the underlyingbitcoin value. Alternatively, tokens may be non-divisible. Anon-divisible token is a contract that specifies the holder's rights interms of a fixed value, e.g. a contract to redeem a house or AU$1000.Non-divisible tokens are therefore not linked to the value of theunderlying bitcoin.

In some examples, tokens must be digitally signed by a token issuer tobe valid. The issuer may, for example be an authority such as aRegistrar of Title deeds. The issuer may issue a token to a user inreturn for payment. That token may then give the user the right toexercise the contract linked to the token, whether the contractrepresents the right to redeem fiat currency or for a service toperformed.

Examples of tokens include:

-   -   A fiat currency token that is pegged to the BTC value of the        transaction output by the issuer of the contract. For example,        “the spender of this token (bitcoin transaction) is entitled to        redeem any fraction of this token for Australian dollars at a        rate of 1 share (10 cents) for every 1000 satoshi”.    -   Partial ownership in an item such as a photocopier.    -   Employee leave entitlements such as annual leave or personal        leave.    -   Further employee benefits such as time in lieu, overtime or        bonuses.    -   Employee fringe benefits.    -   A contract for the right to a service to be performed. It is        noted that this is not the same as the actual service itself,        but only the right to have the service performed for them. This        right can be traded. For example, a voucher from Michael's        Mowing for up to 3 hours lawn mowing within the Sydney        metropolitan area. The holder of this voucher (contract) can        redeem it for the actual service.

Tokens must specify the value of a share, e.g., 1 share=10 cents CAD, 1share=1 rupiah, 1 share=1 day of annual leave, or 1 share=1% ownershipof an item (photocopier, computer, etc).

In one embodiment of the methods described above, the method may be usedto comprise tokenised benefits in addition to or in lieu ofcryptocurrency. For example, the second user 24 (employee) associatedwith the second node 7 may receive a tokenised benefit of an hour ofannual leave for every month of employment at the first user 23(employer) associated with the first node 3.

The details associated with the tokenised benefits may be placed in theredeem script of a P2SH transaction. For example, the details may becomprised in the metadata field of the redeem script according to themethods described above.

In this instance, the first node 3 acts as an issuer of the tokens andcreates the tokens to represent the benefits. The tokens can then betransferred from the first node 3 to the second node 7, for example intothe main payroll account of the second node 7 or another derivedaccount.

In another example, the third node 9 may act as the issuer. In anotherexample, the issuer/service provider 25 may act as the issuer.

The tokens received by the second node 7 may be transferred to anothernode. For example, the tokens may be transferred to another employee ofthe employer associated with the first node 3. Effectively, thetransferable tokens described above may represent tradable employmentrights and benefits of the first node (employer) or second node(employee). These tokenised rights and benefits may be traded betweendifferent employees of the same employer.

Processing Device

As noted above, the first and second nodes 3, 7 may be an electronicdevice, such as a computer, tablet computer, mobile communicationdevice, computer server etc. The electronic device may include aprocessing device 21, 27, a data store 17 and a user interface 15.

FIG. 12 illustrates an example of a processing device 21, 27. Theprocessing device 21, 27 may be used at the first node 3, second node 7or other nodes 9 or 25. The processing device 21, 27 includes aprocessor 1510, a memory 1520 and an interface device 1540 thatcommunicate with each other via a bus 1530. The memory 1520 storesinstructions and data for implementing the method 100, 200, 300, 400described above, and the processor 1510 performs the instructions fromthe memory 1520 to implement the method 100, 200, 300, 400. Theinterface device 1540, may include a communications module thatfacilitates communication with the communications network 5 and, in someexamples, with the user interface 15 and peripherals such as data store17. It should be noted that although the processing device 1501 may beindependent network elements, the processing device 501 may also be partof another network element. Further, some functions performed by theprocessing device 1501 may be distributed between multiple networkelements. For example, the first node 3 may have multiple processingdevices 21 to perform method 100, 300 in a secure local area networkassociated with the first node 3.

Where this disclosure describes that a user, employer, employee, issuer,merchant, provider or other entity performs a particular action(including signing, issuing, determining, calculating, sending,receiving, creating etc.), this wording is used for the sake of clarityof presentation. It should be understood that these actions areperformed by the computing devices operated by these entities.

A user having an account with another entity may comprise the entitystoring information about the user, such as email address, name andpotentially public keys. For example, the entity may maintain adatabase, such as SQL, OrientDB, MongoDB or others. In some examples,the entity may also store one or more of the user's private keys.

It will be appreciated by persons skilled in the art that numerousvariations and/or modifications may be made to the above-describedembodiments, without departing from the broad general scope of thepresent disclosure. The present embodiments are, therefore, to beconsidered in all respects as illustrative and not restrictive.

1. A computer-implemented method for efficient transfer of a quantity ofcryptocurrency on a peer-to-peer distributed ledger between a multipleof nodes, including a first transfer from a first node to a second node,the method comprising: receiving a first request to transfer a firstquantity of cryptocurrency associated with the first transfer from thefirst node to the second node; determining a second node master publickey associated with the second node, wherein the second node masterpublic key forms a cryptographic pair with a second node master privatekey; determining a generator value; determining a second node secondpublic key based on at least the second node master public key and thegenerator value; determining a first output script, wherein the firstoutput script is based on: at least a first metadata that includesinformation associated with the first transfer; and the second nodesecond public key; and sending, over a communications network, a firstdata output to a peer-to-peer distributed ledger based on: an indicationof the first transfer from the first node to the second node; and thefirst output script, wherein the first output script is associated withthe first quantity of cryptocurrency.
 2. The method of claim 1, whereinthe cryptocurrency is associated with a payroll or other data processingsystem, and the first metadata is based on information provided by thefirst node in the first request, wherein the metadata comprisesinformation associated with the payroll and the second node.
 3. Themethod of claim 2, wherein the first metadata comprises a hash of theinformation associated with the payroll and the second node.
 4. Themethod of claim 1, wherein the first node is associated with a firstnode master public key, wherein the first node master public key forms acryptographic pair with a first node master private key.
 5. The methodof claim 4, wherein at least one first node additional public key or atleast one second node additional public key are determined based on atleast the first node master public key and the generator value or thesecond node master public key and the generator value respectively. 6.The method of claim 4, wherein a first node second public key isdetermined based on at least the first node master public key and thegenerator value, wherein the first node second public key forms acryptographic pair with a first node second private key.
 7. The methodof claim 5, wherein the first node second public key or first nodeadditional public key is associated with a tax withheld of the secondnode.
 8. The method of claim 5, wherein the second node second publickey or second node additional public key is associated with a taxwithheld of the second node.
 9. The method of claim 6, wherein the firstnode second public key or first node additional public key is associatedwith a superannuation contribution of the second node.
 10. The method ofclaim 5, wherein the second node second public key or second nodeadditional public key is associated with a superannuation contributionof the second node.
 11. The method of claim 6, wherein the first nodesecond public key or first node additional public key is associated witha house mortgage payment.
 12. The method of claim 5, wherein the secondnode second public key or second node additional public key isassociated with a house mortgage payment.
 13. The method of claim 6,wherein the first node second public key or first node additional publickey is associated with a college fund.
 14. The method of claim 5,wherein the second node second public key or second node additionalpublic key is associated with a college fund.
 15. The method of claim 1,wherein the generator value is based on a string associated with thefirst node.
 16. The method of claim 1, wherein the generator value isbased on Unix time and a nonce.
 17. The method of claim 1, wherein thegenerator value changes based on a payment period.
 18. The method of anyone of claim 1, wherein the generator value is retrieved from a datastore.
 19. The method of claim 1, wherein the generator value isreceived from a third party.
 20. The method of claim 1 wherein thegenerator value is used to determine a common secret based on a firstnode second private key and a second node second public key, wherein thesecond node has the same common secret based on a first node secondpublic key and a second node second private key.
 21. A method ofsecurely transmitting at least part of the first metadata between thefirst node and the second node with symmetric-key algorithm, wherein themethod comprises: determining a symmetric-key based on the common secretdetermined according to the method of claim 20; encrypting at least partof the first metadata with the symmetric-key, to an encrypted at leastpart of the first metadata; and sending, over the communicationsnetwork, the encrypted at least part of the first metadata from thefirst node to the second node.
 22. A method of securely transmitting thefirst output script or information associated with a payroll and asecond user between the first node and the second node withsymmetric-key algorithm, wherein the method comprises: determining asymmetric-key based on the common secret determined according to themethod of claim 20; encrypting at least part of the first output scriptor information associated with the payroll and the second node with thesymmetric-key, to an encrypted first output script or encryptedinformation associated with the payroll and the second node; andsending, over the communications network, the encrypted first outputscript or encrypted information associated with the payroll and thesecond node from the first node to the second node.
 23. A method ofverifying the first transfer according to claim 1, the methodcomprising: receiving a request to confirm the first transfer;determining the first data output corresponding to the first transfer ofthe first quantity of cryptocurrency; receiving, over the communicationsnetwork, at least part of the first data output from the peer-to-peerdistributed ledger; determining, from the first data output, theindication of the first transfer; verifying that the indication of thefirst transfer corresponds to the first transfer in the request; andsending an output indicative of the result of verifying.
 24. The methodof claim 1, wherein a first token is associated with the first quantityof cryptocurrency.
 25. The method of claim 24, wherein the first tokencomprises information associated with employment rights and benefits ofthe first node or second node.
 26. The method of claim 24 wherein thefirst token is transferred from the first node to the second node.
 27. Acomputer program comprising machine-readable instructions to cause aprocessing device to implement the method according to claim
 1. 28. Adevice including a processing device to perform the method according toclaim
 1. 29. A system for efficient transfer of cryptocurrencyassociated with a payroll on a peer-to-peer distributed ledger between amultiple of nodes, including a first transfer from a first node to asecond node, the system comprising: a first processing device configuredto: receive a first request from the first node to transfer a firstquantity of cryptocurrency associated with the first transfer from thefirst node to the second node; determine a second node master public keyassociated with a second user, wherein the second node master public keyforms a cryptographic pair with a second node master private key;determine a generator value; determine a second node second public keybased on at least the second node master public key and the generatorvalue; determine a first output script, wherein the first output scriptis based on: at least a first metadata that includes informationassociated with the first transfer; and the second node public key; andsend, over a communications network, a first data output to apeer-to-peer distributed ledger based on: an indication of the firsttransfer from the first node to the second node; and the first outputscript, wherein the first output script is associated with the firstquantity of cryptocurrency.